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2 1% due to progress. He said there is almost a 1% increase in rising social service costs. He said he would like to reduce the increase to 6% rather than 7%. Mr. Cox asked what Mr. Lynch would propose to cut. Mr. Lynch said he would reduce the head count in departments and would like to se e the City undergo the same evaluation the school system recently did. He said he would reduce funds for economic development and for the Convention and Visitors Bureau, noting that while he believes they are valuable he thinks they can be tightened down. He said he would reduce the pay for performance and would look at the cost of benefits. He said he would make departments partners in coming up with money for pay increases by cutting the number for employees, including the Police Department. He said the number of employees in the Police Department is higher than the national standard. Mr. O'Connell said there will be a similar increase for health insurance that employees will have to pay with no additional benefits. Mr. O'Connell said the projected earnings in the retirement fund has been less than expected over the past three years and more funds need to be put into that. Mr. Caravati noted that the City is unusual in its provision of health benefits for retirees. Mr. Cox expressed concern about c utting things such as economic development and tourism which generate revenue. Mr. Schilling said his opinion is that Council should not micromanage, but said if Council's philosophy has changed he wished they had indicated that up front rather than havin g to go back and find things to cut at this point in the process. Ms. Richards said she would like to put things into perspective, and said she watched as localities that are members in Virginia First Cities are having to raise their real estate taxes in order to maintain current services. She said she feels fortunate that Charlottesville is able to hold its rate steady. She said she is not interested in cutting economic development or tourism as they contribute to our ability to provide services. Mr. C ox agreed that the investment in economic development shows a return. He said he thinks it is foolish to look there and at tourism for cost savings. Mr. Caravati said he is looking to reduce the budget, but said his reductions would be incremental. He s aid economic development has always been important. He said he would like to reduce the amount for the jail by $250,000. Mr. Caravati asked if the department looked at a 2% reduction this year as they did last year. Mr. O'Connell said that if Councilor s want to reduce the budget they need to look at programs and at stopping doing something. He said operating budgets were cut 5% last year. Mr. O'Connell said the capital improvement program could be reduced as could pay increases and the free trolley. Mr. Schilling said it comes down to what we want to do versus what we need to do. Mr. O'Connell said it would have been better for Councilors to have prioritized in the fall and to have indicated they wanted to reduce the budget significantly at that time . Mr. O'Connell said there is a proposal in the budget to look at restructuring, but that takes time. He said to make significant cuts within a week's time can be arbitrary. Mr. Caravati, Mr. Cox and Ms. Richards indicated they would not support reducin g the market rate adjustments.